Samsung secures multiyear $16.5 billion chip supply deal with Tesla

Samsung Electronics will produce Tesla’s next‑generation AI6 chips at its new Taylor Texas fabrication plant under a multiyear agreement valued at $16.5 billion, Elon Musk said on X following an earlier regulatory filing in which Samsung disclosed a large customer without giving names.

The deal runs through 2033 and is expected to provide a long‑needed lift to Samsung’s struggling foundry business that has faced increasing competitive pressure especially from industry leader TSMC with whom Samsung trails significantly in advanced logic chip market share.

Tesla’s AI4 chips meant for full self‑driving systems are already produced by Samsung but the interim AI5 generation has been awarded to TSMC with production coming online in Taiwan and eventually Arizona, Musk said.

In his post, Musk stressed that Samsung agreed to let Tesla help optimize manufacturing and that he would walk the production line personally to accelerate progress noting the Texas fab’s proximity to his residence.

Samsung shares surged about 6.8% to their highest level since September, with analysts describing the Tesla contract as vital validation for the Texas plant which until recently had few customers and had delayed start‑up into 2026.

For Tesla the arrangement strengthens its chip supply chain diversified across both Samsung and TSMC and supports its ambitions in AI robotics autonomous driving and on‑site infrastructure such as its Dojo supercomputing system